Mideast’s Top Private Equity Firm Ready to Pounce as Rivals Fade - Bloomberg

Mideast’s Top Private Equity Firm Ready to Pounce as Rivals Fade - Bloomberg

The biggest private equity and alternative asset manager in the Middle East is on the lookout for deals after the economic fallout of the pandemic made companies cheaper to buy and scandals thinned out the competition.

Investcorp Holding BSC, which manages about $34 billion, is looking to do more in the region across the health-care, transport, logistics and industrial sectors, said Walid Majdalani, the firm’s head of private equity for the Middle East and North Africa.

The firm, which has channeled $1.4 billion into the region over the past decade and made a return of about 1.8 times on invested capital, is also facing less competition from other private equity investors, he said. Over the past four years, Investcorp helped sell three family-controlled companies in which it held stakes on the Saudi stock exchange.

“We see a lot of opportunity to replicate what we have done already in Saudi Arabia -- the difference is now business owners are a lot more realistic about valuations,” Majdalani said. “Also, in terms of other people who do what we do and have teams on the ground, today we don’t see a lot of competition.”

The private equity industry in the Middle East has been rocked by the collapse of Abraaj Capital in 2018 and the arrest of several of its executives amid allegations that it misused investor funds. Dubai-based Al Masah Capital Ltd. was placed in liquidation earlier this year after it was fined for allegedly misleading investors about fees and its founder Shailesh Dash banned from working in the emirate’s financial center.